Empire State Realty Trust Launches Private Perpetual Preferred Stock
Exchange Offer
Operating Partnership Unitholders Offered Greater Than 75% Increase in
Distribution, in Tax-Deferred Security
Management Believes Transaction Consistent with Objectives to Drive
Shareholder Value and Increase Distributions
Business Wire
NEW YORK -- May 28, 2014
Empire State Realty Trust, Inc. (NYSE:ESRT) (the "Company"), a leading real
estate investment trust with office and retail properties in Manhattan and the
greater New York metropolitan area, today announced that it is commencing an
exchange offer for up to $250 million of the operating partnership (“OP”)
units (the “Exchange Offer”) of Empire State Realty OP, L.P. (“ESRO”).
Upon completion of the Exchange Offer, all OP units tendered will be converted
on a one-for-one basis into Private Perpetual Preferred Units of ESRO (the
“Preferred Units”) paying $0.60 per unit per annum, giving unitholders an
increase in annual distribution from their current $0.34 to $0.60, a more than
75% increase.
The transaction is only available to current OP unitholders, is not being sold
to the public, and will continue the tax-deferral status unitholders achieved
in ESRT’s formation transactions. The Exchange Offer is conditioned on
customary conditions that are more fully described in the Exchange Offer
materials, which have been filed with the Securities and Exchange Commission
(the “SEC”) and sent to OP unitholders. The lead underwriters of ESRT’s
initial public offering have waived certain “lock-up” restrictions to allow
participation in the Exchange Offer by OP unitholders.
Anthony E. Malkin, Empire State Realty Trust’s Chairman, CEO and President,
said: “Management believes this transaction is consistent with our stated
objectives to drive shareholder value and increase distributions. We believe
this may be a compelling alternative for certain OP unitholders who derive a
significant percentage of their total income from their investment in us by
offering them a materially higher current return. We are pleased to offer this
unique, tax-deferred opportunity to our OP unitholders, many of whom have
expressed a desire for a higher yielding security. ”
The Exchange Offer will expire at midnight, New York City time, on June 26,
2014, unless extended or earlier terminated by the Company (such date and
time, as the same may be modified, the “Expiration Date"). Holders who tender
their OP units may withdraw them at any time prior to the Expiration Date. In
addition, after the Expiration Date, holders may withdraw any OP units that
were tendered but not accepted for exchange within 40 business days after the
commencement of the Exchange Offer. Subject to applicable law, the Company
may, in its sole and absolute discretion, amend, extend or waive conditions
to, or terminate, the Exchange Offer.
The full details of the Exchange Offer, including complete instructions on how
to exchange OP units, are included in the offer to exchange, the letters of
transmittal and related materials. OP unitholders should read the offer to
exchange and other related materials carefully because they contain important
information. OP unitholders may obtain free copies of the offer to exchange
and other related materials from the SEC’s website at www.sec.gov. The Company
has retained MacKenzie Partners, Inc. to serve as information agent in
connection with the Offer. Requests for documents and questions regarding the
Exchange Offer may be directed to MacKenzie Partners, Inc. at (888) 410-7850.
This is a purely optional exchange for OP unitholders. None of ESRT, its
directors, officers or employees are making a recommendation to unitholders as
to whether they should tender OP units in the Exchange Offer. Each holder of
OP units must make such holder’s own investment decision regarding the
Exchange Offer based upon such holder’s own assessment of the value of the OP
units, individual liquidity and investment objectives, and any other factors
such holder deems relevant.
TheExchange Offeris being made pursuant to an exemption from registration
under Section3(a)(9) of the Securities Act of 1933. TheExchange Offeris not
being made in any jurisdiction, or to or from any person, which would make
such offer or solicitation unlawful under applicable securities laws. This
press release is for informational purposes only and is not an offer to buy or
the solicitation of an offer to sell any securities.
About Empire State Realty Trust
Empire State Realty Trust, Inc. (NYSE: ESRT), a leading real estate investment
trust (REIT), owns, manages, operates, acquires and repositions office and
retail properties in Manhattan and the greater New York metropolitan area,
including the Empire State Building, the world's most famous office building.
Headquartered in New York, New York, the Company's office and retail portfolio
covers 8.4 million rentable square feet, as of March 31, 2014, consisting of
7.7 million rentable square feet in 12 office properties, including seven in
Manhattan, three in Fairfield County, Connecticut and two in Westchester
County, New York; and approximately 623,000 rentable square feet in the retail
portfolio. The Company also owns land at the Stamford, Connecticut
Transportation Center that supports the development of an approximately
380,000 rentable square foot office building and garage and has recently
exercised its options to acquire the ground lease of two additional Manhattan
office properties encompassing approximately 1.5 million rentable square feet
of office space and over 150,000 rentable square feet of retail space at the
base of the buildings.
Forward-Looking Statements
This press release includes "forward looking statements". Forward-looking
statements may be identified by the use of words such as "believes,"
"expects," "may," "will," "should," "seeks," "approximately," "intends,"
"plans," "pro forma," "estimates," "contemplates," "aims," "continues,"
"would" or "anticipates" or the negative of these words and phrases or similar
words or phrases. The following factors, among others, could cause actual
results and future events to differ materially from those set forth or
contemplated in the forward-looking statements: the factors included in the
Company's Annual Report on Form 10-K for the year ended December 31, 2013,
including those set forth under the headings "Risk Factors," "Management's
Discussion and Analysis of Financial Condition and Results of Operations," and
"Business,” and “Properties." While forward-looking statements reflect the
Company's good faith beliefs, they are not guarantees of future performance.
The Company disclaims any obligation to publicly update or revise any
forward-looking statement to reflect changes in underlying assumptions or
factors, of new information, data or methods, future events or other changes
after the date of this press release, except as required by applicable law.
For a further discussion of these and other factors that could impact the
Company's future results, performance or transactions, see the section
entitled "Risk Factors" in the Company's Annual Report on Form 10-K for the
year ended December 31, 2013, and other risks described in documents
subsequently filed by the Company from time to time with the Securities and
Exchange Commission. Prospective investors should not place undue reliance on
any forward-looking statements, which are based only on information currently
available to the Company (or to third parties making the forward-looking
statements).
Contact:
MacKenzie Partners, Inc.
888-410-7850